Business Types and Their Business Registration Requirements
Starting a business in the Philippines? If yes, we are very confident that these information is going to be useful for you.
Registration is a must for every business in order to legalize it. A business acquires a unique identity and protection when it is registered. Investment of clients and bank credit is also a lot easier for a registered business. Registration also contributes to the continuity of a business.
There are requirements to be passed for a business registration in the Philippines based on the business type. For every business entity, there are different agencies to which the prerequisites shall be passed.
Three Major Types of Business
1. Service Business
Intangible products, those without physical form are provided by this type. Firms classified as service businesses offer consultation, professional skills, and advice.
Examples: salons, banks, schools, repair shops, accounting firms, law firms
2. Merchandising Business
Products are bought at wholesale price and sold at retail price in merchandising. “Buy and sell” is another term for a merchandise. Merchandisers generate profit by having lower purchase costs and selling at higher prices. The products do not take another form.
Examples: resellers, convenience stores, groceries, distributors
3. Manufacturing Business
Products are bought and are then used as materials for new product creation. There is a transformation of purchased products in a manufacturing business.
A combination of labor, overhead costs, raw materials, and labor is involved in the production process. The customers buy the manufactured goods.
Companies that may be classified as more than one type of business are referred to as hybrid businesses.
In a restaurant, ingredients are mixed in cooking fine meals (manufacturing), markets cold bottles of wine (merchandising), and caters to customer orders (service).
Business registration is according to form. Nowadays, it can be easier done because online registration services are now available.
Forms of Business Organizations
- Sole proprietorship
- Domestic Owned
- Foreign Owned
- Domestic Stock
- Domestic Non-stock
- Foreign Owned
General Procedure/Guidelines for Business Registration
- Secure a valid business name.
- Determine the type of business entity.
- Register it in the Department of Trade and Industry or Securities and Exchange Commission, based on the business type.
- Get sector-specific clearances according to scope: barangay, municipal, regional, or national.
- Acquire a Mayor’s permit if it is needed for its business type.
- Register it with the Bureau of Internal Revenue (BIR).
- Acquire business registration from other government and/or partner agencies as needed.
Business Registration Requirements
Business Name Registration Certificate
Where: DTI-Provincial Office where the business is located or log on to www.bnrs.dti.gov.ph or http://www.business.gov.ph/
Validity: 5 years
- Presentation of 1 copy of government issued ID
- Accomplished Business Name Registration form (BTRCP FORM 16A) in duplicate
- Registration fee depending on territorial coverage of the business name and documentary stamp :
Barangay – P 200.00
Municipal – 500.00
Regional – 1,000.00
National – 2,000.00
Documentary Stamp tax of P15.00 per application.
Business Name Registration Application Form
New Application – PBR SPNR Application Form.pdf
Renewal Application – Business Name Application Form (2011-06-13).pdf
For Partnerships and Corporations – REGISTERING WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC)
SEC Registration Certificate
Validity: Lifetime – according to the new corporation code SEC. 11. A corporation shall have perpetual existence unless its articles of incorporation provide otherwise.
Requirements for Partnership:
. Name Verification Slip (online or at the name Verification Unit)
. Articles of Partnership
. Written Undertaking to Change Corporate Name by any partner
. Form F-105 for partnership with Foreign Equity
. Proof of Inward Remittance by foreign partners
Requirements for Stock (S) and Non Stock (NS) Corporations:
. Verification Slip Form (S) (NS)
. Articles of Incorporation (S) (NS)
. T reasurer’s Affidavit (S)
. Notarized Bank Certificate of Deposit where the bank is located (S)
. Written Undertaking to Change Corporate Name by any Incorporator or Director (S), by any Trustee (NS)
. Clearance from other government agencies (S)
. Foreign Investment Application Form F-100 (for subsidiaries of foreign corporations (S)
. Proof of Inward Remittance by Non-Resident Aliens/Subscribers (S)
. List of members and amount contributed certified by the Secretary and Treasurer (NS)
. Registration fee of Php 360.00
For Cooperatives – REGISTERING WITH THE COOPERATIVE DEVELOPMENT AUTHORITY (CDA)
Certificate of Registration
. Economic Survey (4 copies)
. By-Laws and Articles of Cooperation duly notarized (available at CDA office) – 4 copies
. At least 15 members
. Undertaking to change name
. Undertaking to submit reportorial requirements
. Bond of accountable officers
. Cooperative Pre-membership Education Seminar Certification
. Favorable endorsement of proper government agency, if necessary
. Capitalization of at least Php 15,000.00 (total paid-up capital)
. Cooperative Annual Performance Report and audited financial statements for them to secure a certificate of good standing
Schedule of fees:
TYPES OF COOPERATIVES
Laboratory Cooperatives – No Registration Fee
Primary Cooperatives – Paid-up Capital of P2,000.00 – 500,000.00 up, Fee of P500.00 – 1/10 of 1% of the paid up capital
Secondary Cooperatives – Paid-up Capital of P2,000.00 – 500,000.00 up, Fee of P1,000.00 – 1/10 of 1% of the paid up capital
Tertiary Cooperatives – Fee of P3,000.00
REGISTERING WITH THE BUREAU OF INTERNAL REVENUE (BIR)
(Follow steps 1 and 2 of the Process Flow before registering with the BIR)
Tax Identification Number (TIN)
Authority to Print Invoice and Book of Journal
Validity: 1 year
- Application for Tax Identification Numbers (TIN) for Employers
- a) Self Employed/Mixed Income Individual (BIR Form 1901)
- Birth Certificate or any valid ID showing name, address and birth date
- Mayor’s Permit or application for Mayor’s Permit
- DTI Certificate of Registration of Business Name
- b) For Partnerships and Corporations (BIR Form 1903)
- SEC Certificate of Registrations for Partnerships and Corporation
- License to do business in the Philippines (in case of residence foreign corporation)
- Mayor’s Permit or Application for Mayor’s permit
- Application for Authority to Print Receipts and Invoices
- a) For New Taxpayers (BIR Form 1906)
- Job Order
- Final and Clear Sample of Receipts and Invoices (machine printed)
- Photocopy of BIR Form 1901 or 1903, TIN Card, Proof of Payment (BIR Form 0605)
- b) For Registered Taxpayers (BIR Form 1906)
- Job Order
- Final and clear sample of receipts and invoices
- Photocopy of Proof of Payment (BIR Form 0605, previously approved Authority to Print Invoice (ATP), Certificate of Registration (COR) BIR Form 2303, last booklet printed
Step 4 – Other Registration Requirements
Register your business with the following offices to comply with existing regulations:
– Social Security System (SSS)
– Department of Labor and Employment (DOLE)
– PAG – IBIG
– Department of Environment and Natural Resources (DENR)
REGISTERING WITH THE DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE)
(Follow steps 1 to 3 of the Process Flow before registering with the DOLE)
Every employer, as defined in Rule 1002 of the Occupational Safety and Health Standards, shall register his/her business to the Regional Labor Office or authorized representative having jurisdiction thereof to form part of the databank of all covered establishments.
Where: DOLE-NCR Building, Maligaya St. Malate, Manila or go to the Nearest DOLE Regional/Provincial Office
- Registry of establishments under Occupational Health and Safety Standards No. 1020
REGISTERING WITH THE SOCIAL SECURITY SYSTEM (SSS)
(Follow steps 1 to 3 of the Process Flow before registering with SSS)
Social Security System (SSS) Certificate
- Employers Registration (SSS Form R1) and Employment Report (SSS Form R1A)
- Specimen Signature Card (SS Form L -501)
- Sketch of business
- If Employer (Main Office)
- Business Name Registration
- Business Permit or any proof of business operations
- Photocopy of approved Articles of Partnership (original must be presented for authentication purposes)
- Photocopy of approved Articles of Incorporations (original must be presented for authentication purposes)
- SSS Form R -1 and R-1A (signed by the President or any of its Corporate Officers)
- If Self-Employed member
- SSS Form R -1 (Self Employed Data Record)
- Photocopy of any of the following: Baptismal Certificate, Birth Certificate, Drivers License, Passport, PRC Card, Seaman’s Book
REGISTERING WITH THE Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno (PAG-IBIG)
(Follow steps 1 to 3 of the Process Flow before registering with PAG-IBIG)
Per Republic Act 7742 which was fully implemented on 01 January 1995, membership to the Pag-IBIG Fund shall be mandatory for all employees covered by the Social Security System (SSS) and/or the Government Service Insurance System (GSIS) and earning at least P4,000 a month. This mandatory coverage extends to expatriates whose age is up to 60 years old and who are compulsorily covered by the SSS.
Membership for employees who are earning less than P4,000 a month, including those who belong to other working groups, shall be on a voluntary basis. ,
Requirements For Individual Payors (IPs)
- Employer’s Data Form
- Members Data Form (for employees)
- Certificate of SSS Coverage and Compliance
- DTI Business Name Registration
- Mayor’s Permit or Business Permit
Partnership / Corporation
- SEC Registration or Articles of Partnership (for partnership) or Articles of Incorporation (for corporation) and By-Laws.
*Bring original copies for authentication purposes
***Other document requirements:
- Business location sketch/map
- Miscellaneous Payment Return (SS Form R-6) validated, or SS Form R-6 with Special Bank Receipt (SBR) – proof of payment for the Employer Registration Certificate
These are all the necessary information about the registration of businesses according to business types, but the requirements and rules may vary accordingly in time. To ensure that the processes are run smoothly and to minimize your worries, you can also have these outsourced to a reliable accounting firm that truly desires to meet your specific business needs. Talk to us at DJKA Business Services Inc. and Book A Consultation Today!